Category Archives: Best Rates

Could a slowdown in China result in a weaker Australian Dollar?

Our regular readers will be aware of the connecting between the Australian and Chinese economies, and in particular the importance of a strong Chinese economy and how this can benefit Australia along with the Australian currency.

In the early hours of this morning Chinese GDP figures were released by the National Bureau of Statistics and the data shows that in the second quarter of this year China’s economy grew at its slowest pace since 1992, which is growth at a rate of 6.2%. This figure was expected so we haven’t seen a sell-off in the value of the currencies tied to the Chinese economy which the Australian Dollar arguably is, but it could be a warning sign moving forward.

The trade war between Australia and the US appears to have taken its toll on the Chinese economy, and the efforts of the Chinese Central Bank don’t appear to have has d the intending effect which is why the economies growth is shrinking. Through 2018 the growth figure for the year was 6.6%, and I think that those of our clients and readers that are hoping for a stronger Aussie Dollar should continue to monitor the Chinese economies performance.

Although there will be no data releases out of the UK today, there will be a number of key releases this week such as Earnings Data tomorrow morning and a speech from Bank of England governor Mark Carney tomorrow amongst other releases throughout the week. Do feel free to register your interest with me if you wish to be updated in the event of a major market movement between the GBP/AUD pair.

If you have a large currency exchange to carry out in the coming days, weeks or months then you are more than welcome to speak with me directly as I will be more than happy to help you both with trying to time a transaction and getting you the top market rate when you do come to buy your currency. A small improvement in a rate of exchange can make a huge difference so for the sake of taking two minutes to email me you may find you save yourself hundreds if not thousands of Pounds. You can email me (Joseph Wright) on jxw@currencies.co.uk and I will endeavour to get back to you as soon as I can.

Best time to sell Australian dollars for pounds since January : Will the Australian dollar rise further?

The Australian dollar has very recently hit the best time to be sold against sterling at 1.7868, since January 2019. This is a combination of factors including the strength of the Australian dollar, and also the weakness in the pound. A fine example of the strength on the Aussie was shown last week when the RBA (Reserve Bank of Australia) only cut their rate by 0.25%, with the market predicting 0.5% potentially and also signs of future cuts.

By refraining from committing to further cuts, the Aussie found some strength. Sterling is of course suffering under the pressure of Brexit uncertainties, as the market continues to attempt to digest what Brexit means and prepare for a no-deal.

On the Aussie, the market was also recently offered some good news with the G20 Summit not resulting in a severe deterioration of relations between the US and China. In fact, the two sides found some loose agreement and compromise and with the situation not destabilising majorly, the Aussie has again found some form. Investors are still preparing for future concerns on the trade wars and also the possibility of future cuts, but with these not manifesting immediately as troubles, the Aussie has risen.

The pound looks like it might well struggle ahead as both Conservative Party leadership and future UK Prime Minister candidates seek to embrace a no-deal Brexit. Sterling has suffered in the face of the uncertainty and we have seen the pound lower, it is not straightforward to see where future strength will emanate from, although some clarity over who will be the UK PM might help the pound.

Expectations are still mixed on the type of Brexit we will see, with Labour backing a second referendum more strongly, and many seeing the chance of a General Election increasing, there could be more volatility ahead.

Pound to Aussie dollar rates look due to remain below 1.80 but any sudden changes in sentiment could well see a quick reversal of the current trend, particularly with the higher level concerns on trade wars and interest rate cuts for the Aussie still remaining a longer term concern.

Thank you for reading and please let us know if there are any currency transfers that you wish to run through or discuss.

Thank you, Jonathan Watson

jmw@currencies.co.uk

 

Pound to Australian Dollar remains below 1.80 for now, but could AUD come under pressure and reverse the trend?

The Pound to Australian Dollar rate remains below the 1.80 level, although judging from the trend so far today it looks like we could see this level tested again soon as the Australian Dollar comes under pressure.

In the early hours of this morning it was confirmed as expected that Business Confidence within the country is declining and this has added pressure on the Australian Dollar. The currency has also been coming under pressure due to expectations of further interest rate cuts from the Reserve Bank of Australia later in the year, and now that the Central Bank of the US, The Federal Reserve Bank is expected to make less cuts than expected, we could see the the Aussie Dollar continue to soften. Previously AUD had been in high demand due to the high returns offered by banks down under but now that the base rate of interest has been cut to its record low of 1%, with further cuts expected AUD has lost some of its attractiveness especially against the US Dollar.

Sterling is likely to continue to be driven by the Conservative Leadership contest as anyone following UK politics will be aware. The Pound has been trading in a flat fashion recently and until the contest is over and we get an idea of the next steps for Brexit I expect this to continue.

If you have a large currency exchange to carry out in the coming days, weeks or months then you are more than welcome to speak with me directly as I will be more than happy to help you both with trying to time a transaction and getting you the top market rate when you do come to buy your currency. A small improvement in a rate of exchange can make a huge difference so for the sake of taking two minutes to email me you may find you save yourself hundreds if not thousands of Pounds. You can email me (Joseph Wright) on jxw@currencies.co.uk and I will endeavour to get back to you as soon as I can.

Australian dollar forecast: Will the Australian dollar weaken ahead?

The latest movements on the Australian dollar have seen the currency slightly stronger as investors buy into the Aussie following a more optimistic outlook on the Trade War concerns, plus the lack of any more immediate cuts from the RBA (Reserve Bank of Australia).  The RBA in their commentary have seen potential for more cuts ahead but have not directly signalled them, hence the Aussie rising.

Clients looking to any Australian dollar transfers might wish to consider the latest developments in these scenarios, as whilst to a degree the potential for the Aussie to weaken is present, the actual turn of events does not seem to be causing this. Allow me to elaborate! Generally, the cutting of interest rates will cause the currency concerned to weaken.

Therefore, with the RBA cutting interest rates, it might be perceived that the Australian dollar would weaken. However, with the RBA not looking to make any more immediate cuts, the currency has actually strengthened. The cutting of rates up ahead could be a factor that would weaken the Australian dollar in the future, clients looking to buy or sell Australian dollars up ahead might benefit from a quick review of their situation with one of our team.

The Trade Wars are another example of the uncertainty up ahead that whilst generally negative for the Australian currency, have also been more positive for the currency lately. The Australian dollar is trading at some of the best rates this year against the pound as the uncertainty of Brexit, plus the recent optimism for the Aussie dollar itself, all helps to lead to the rate dipping below 1.80, into the 1.79’s.

The Australian dollar has not completely shifted the potential for weakness, but with the potential for further cuts ahead, and also the trade wars still possibly an issue in the future. If you have a Australian dollar transfer for the future, and wish for some of the latest news concerning the rates and the market, please do get in touch.

 

GBP to AUD rate expected to continue its decline this week

The Pound to Australian Dollar exchange rate has begun the week just north of the 1.80 benchmark level, which is around 3-cents lower than where the pair begun the week last week. There haven’t been many reasons for the Pound to climb in recent weeks and I think that until there is a new PM in place we could continue to see the political uncertainty continue to weigh on the Pound’s value which could push the GBP/AUD pair below the 1.80 level.

There will be a Reserve Bank of America meeting tomorrow and there are expectations of another interest rate cut, but as markets expect this amendment it’s already priced into the value of the Aussie Dollar. Despite this expected cut AUD is strengthening so I don’t expect to see the Aussie Dollar drop in value in it takes place, but I do expect to see the Aussie Dollar strengthen if the cut doesn’t take place.

Aside from this meeting the Aussie Dollar is being influenced at the moment but the US President’s trip to Asia, as not only has there been some positive developments between the US and China, which is a key trading partner for Australia, but we have also witnessed the first meeting on North Korean soil between a US President and North Korean leader and this has buoyed the markets. This kind of news is likely to further boost the Aussie Dollar, as it tends to gain in value in times of positive global updates due being a commodity currency.

If you have a large currency exchange to carry out in the coming days, weeks or months then you are more than welcome to speak with me directly as I will be more than happy to help you both with trying to time a transaction and getting you the top market rate when you do come to buy your currency. A small improvement in a rate of exchange can make a huge difference so for the sake of taking two minutes to email me you may find you save yourself hundreds if not thousands of Pounds. You can email me (Joseph Wright) on jxw@currencies.co.uk and I will endeavour to get back to you as soon as I can.

Will further interest rate cuts result in a drop for the Australian Dollar this year?

The Australian Dollar has continued to come under pressure recently which has helped the Pound recoup some of its recent losses against the currency. One of the reasons for the downturn for AUD is due to the interest rate cut that took place earlier this month, which has pushed Australian interest rates down to record lows. There are now predictions of further rate cuts from the Reserve Bank of Australia with some financial institutions predicting two further cuts this year, which would push the rate down to 0.75% and likely have a negative impact on the Aussie Dollars value.

Aside from these forecasts of rate cuts due to the slowing economy, another reason for Aussie Dollar weakness is due to the ongoing US-China trade war saga, which has caused concerns for the Australian economy moving forward. I would expect to see AUD exchange rates continue to struggle whilst this continues, owing to the fact that China is the countries main trading partner.

From the UK side the Conservative leadership contest is likely to remain the key driver, with Boris Johnson remaining the front runner. This leadership contest along with any Brexit related updates remain the key driver for GBP exchange rates so do keep on top of this if you’re following the Pound’s value due to an upcoming currency requirement.

If you have a large currency exchange to carry out in the coming days, weeks or months then you are more than welcome to speak with me directly as I will be more than happy to help you both with trying to time a transaction and getting you the top market rate when you do come to buy your currency. A small improvement in a rate of exchange can make a huge difference so for the sake of taking two minutes to email me you may find you save yourself hundreds if not thousands of Pounds. You can email me (Joseph Wright) on jxw@currencies.co.uk and I will endeavour to get back to you as soon as I can.

Australian Growth data causes Investor Concern (Daniel Johnson)

Pound to Australian Dollar Forecast

The Australian Dollar has suffered of late due to several contributing factors. The most significant catalyst for the fall in Australian Dollar value is the US/China trade war. Australia is heavily reliant on China purchasing it’s goods and due to this any slow down in growth in China will have an impact on the Australian Dollar.

The Trump administration has placed significant tariffs on Chinese goods and China has retaliated with it’s own tariffs. The trade war is set to escalate and could be ongoing which does not bode well for the Aussie. Iron ore is Australia’s primary export to China and at present demand remains healthy which is good news for the Aussie, that is not to say this situation will last however.

Due to global economic uncertainty investors are choosing to shy away from riskier commodity based currencies such as AUD in favour of safe haven currencies such as the Swiss Franc and the US Dollar.

There are economic problems down under such as consumer spending and the cost of living in high wage growth areas such as Sydney and Melbourne. The Reserve Bank of Australia (RBA) took the decision to cut interest rates this month to 1.25% and there is the potential for further cuts.

The Australian economy is growing at its slowest rate in almost a decade, which has fuelled speculation surrounding how long Australia will sustain its run of over 27 years without a recession.

Despite the situation down under I believe the  problems in the UK outweigh that of those down under. We currently have no PM and are in complete Brexit limbo. If Boris gets in the probability of a no deal could increase as he will be using this scenario as a bargaining chip to get a better deal from Brussels. A no deal is the investors worst fear and has the potential to cause further woes for Sterling.

If you have a currency requirement I will be happy to assist. If you let me know the details of your trade I will endeavor to produce a free trading strategy. During a period of such uncertainty it is important to be in touch with an experienced broker if you wish to maximize your return. We have tools at our disposal to make sure you do not miss out if there is a spike in your favour.
If you already have a currency provider in place. Drop me an email with what you are being offered and I am very confident I will be able to demonstrate a significant saving. It will only take you two minutes and I am sure it will be worth your while. You can trade in safety knowing you are with a Foreign Currency Direct PLC, a firm trading for over 16yrs and FCA registered.

If you would like my help feel free to email me at dcj@currencies.co.uk.

Australian dollar forecast: Will the RBA cut their interest rates again?

The Australian dollar is weaker this week, following the news that Australian employment data, whilst reasonably positive, was not inspiring enough to majorly turn the tide on the Australian currency. With the outlook on interest rates shifting following very poor GDP (Gross Domestic Product), which recently came in at a decade low, the Reserve Bank of Australia might well be looking to cut their interest rates once again ahead.

I am concerned about some of the more global issues that will influence the Australian dollar too, the prospect of the trade wars deteriorating ahead could be a major concern for the currency. It is likely that the Australian dollar will suffer as investors are fearful over the slowdown in the Chinese economy, this weekend’s G20 Summit will be key in determining what happens next.

If you are looking to buy or sell the Australian dollar, making some careful plans in advance is usually a good idea to try and help mitigate the uncertainty. As a commodity currency, the Australian dollar will often rise and fall on the waning attitudes to global risk and trade. Donald Trump is a real wildcard here and his constant to and fro on the trade wars, is harming sentiment.

Next week, is a series of important economic releases with the Governor of the RBA, looking to make a speech plus the latest RBA Meeting Minutes. In providing information on what lies ahead, we will learn of the latest news and developments we might expect. I predict that Lowe will have to keep the door open to further cuts and this could see the Aussie weaker.

Looking at the general trend and trajectory on the trade wars, I think the Australian dollar could lose more ground ahead. Expectations are mixed over what to expect this weekend, any signs of agreement between Trump and China, could provide some shorter-term relief for the Aussie. However, I do feel that any improvement in sentiment will only be short-term, and there will continue to be a longer net negative concern from the trade wars which will affect the Australian dollar.

Thank you for reading my post and should you have a Australian currency transfers that you wish for assistance with, I would be most interested to hear from you and discuss strategy to assist with the best rates and timings.

Jonathan Watson

jmw@currencies.co.uk

Australian Dollar weakens as trade wars hit the headlines

The Australian Dollar can be impacted by global attitude to risk and news that Donald Trump and China are still locked in battle over their trade wars is not helping the value of the currency.

The G20 summit in Japan this weekend will be key for where this may head next, should the rift continue and both sides continue to throw more and more tariffs at each other then this could damage Australian Dollar exchange rates.

Chinese economic data has also had an impact on the Australian Dollar overnight, as inflation posted at a 15 month high last night. Poor economic data from China can have a negative impact on the value of the Australian Dollar due to the strong trading ties and the number of exports from Australia to China. Should China start to struggle then you can tend to see a ripple effect onto the Australian economy so the markets tend to move in advance of this. Chinese Retail Sales figures are released on Friday so this will be one to watch.

In terms of Australian data, we have a few key releases this week with unemployment figures out tomorrow and investors and speculators alike will also be looking out for any hints or comments from members of the RBA as to their plans for what to do next with interest rates.

There are growing expectations that we may see an interest rate cut from the RBA in the near future, and this has the potential to result in the Australian Dollar losing a little ground.

My personal view is that I feel that the Australian Dollar may weaken a little in the coming weeks due to the various points above, so if you have Australian Dollars to buy then it may be one to watch very closely, if you have Australian Dollars to sell then it may be tempting to start considering making a move on soon. Of course with all the worldwide politics going on the market and opinions can change in an instant so it is key if you are in the position where you have an exchange to carry out that you have a proactive broker on your side, with various options on offer.

If you have a transaction to carry out and you would like our assistance then feel free to get in touch with me directly. You can email me on djw@currencies.co.uk and I will be happy to help you.

US/China Trade Wars hurt the Australian Dollar (Daniel Johnson)

Australian Dollar hit by Trade Wars

In times of global economic uncertainty, commodity-based currencies such as the Australian Dollar usually struggle as investors seek safe haven investments for their money. Due to this the Australian Dollar has come under pressure lately due to the trade war between the US and China.

Australia has a heavy reliance on China purchasing it’s exports and as such any fall in Chinese growth has a knock on effect on the Aussie.  There has been steep fall  in Chinese trade activity for last month caused by the ongoing trade impasse with the United States.

Could there be further rate cuts from the RBA?

Another factor in the value of AUD has been the Reserve Bank of Australia’s (RBA) decision to cut interest rates to a record low of 1.25% earlier this year. This was an attempt to boost inflation towards the RBA’s target level of 2-3%. Based on comments from RBA members earlier this year there are predictions in the press that we could  see  more rate cuts later this year. This has the probability to weaken the Australian Dollar.

Those with an Australian Dollar requirement should keep an eye out for Australian employment data due out in the early hours of Thursday. Unemployment has risen in Australia of late, which was a contributing factor in the RBA’s recent rate cut, and if this is reflected yet again in May’s figures then the Aussie could lose value.

Comments from any RBA members following this data release could give an insight to monetary policy moving forward could therefore have an impact on the Australian Dollar.

Australia’s problems do not have the same weight as those of the UK’s, with no Prime Minister and Brexit in limbo, the Pound could be set for further losses, with the majority of candidates up for Tory leader ready to bring a ‘no deal’ back to the table. I expect Sterling to remain fragile for the foreseeable future.

If you have a currency requirement I would be happy to assist. If you wish to maximise your return it is important to be in touch with an experienced broker. If you let me know the details of your trade I will endeavour to produce a trading strategy to suit your needs. If you have a currency provider in place I am willing to perform a live comparison and I am confident I will be able to demonstrate a considerable saving. It will only take a couple of minutes and could be well worth your while.
You can trade in safety knowing your trading with Foreign Currency Direct PLC, a company trading for over 18 years. Our accounts are published online at companies house and we are FCA registered.

If you would like my help I can be contacted at dcj@currencies.co.uk. I look forward to hearing from you.